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S-REITs Bi-Weekly Updates (1-15 Sep 21)

Singapore is experiencing an exponential surge in daily COVID-19 infections. Thankfully, ICU admission and deaths remain low. BUY New Economy plays AREIT (Target: S$3.83), FLT (Target: S$1.79), MINT (Target: S$3.63) and ALLT (Target: S$1.02). BUY Reopening plays ART (Target: S$1.16), FCT (Target: S$3.06) and LREIT (Target: S$1.01). Maintain OVERWEIGHT.

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WHAT HAPPENED IN THE LAST TWO WEEKS

FSTREI dropped 0.5% in the past two weeks. Singapore is experiencing an exponential surge in daily COVID-19 infections. According to Minister of Health Ong Ye Kung, daily cases started to rise sharply to almost 100 on 23 Aug 21. Based on experiences of European countries, a transmission wave takes four to eight weeks (28 to 56 days). Daily cases in Singapore could double every 10 days and hit a peak of 3,200. Singapore has stoically weathered the surge in new cases. In the last 28 days, 98.2% of new cases are asymptomatic or have mild symptoms. Thankfully, ICU admission and
deaths remain low. Starting 14 Sep 21, Singaporeans who took their second dose of COVID-19 vaccine in 1Q21 can make appointments for booster shots. Seniors aged 60 and above will also be given booster shots.

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Top outperformer: New constituents added to FTSE EPRA Nareit Developed Asia Index, such as OUECT (+8.5%), FEHT (+6.8%), CERT (+6.4%), SGREIT (+4.9%), EREIT (+3.2%), PRIME (+3.0%), ALLT (+2.8%), SPHREIT (+2.7%) and KORE (+1.3%), rallied with sizeable gains. A total of 11 S-REITs were included during the latest quarterly review conducted in September, which become effective on 20 Sep 21.

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Top underperformer: Top losers were mainly casualties of the outbreak of Delta variant, putting a small dent on the reopening theme. Hospitality REITs FHT, CDREIT and ART declined 7.0%, 5.1% and 3.9% respectively. Retail REITs SUN, SASSR, LREIT, FCT and UHU declined 4.8%, 3.8%, 3.4%, 3.0% and 2.8% respectively.